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Why some government agencies have been investigating blockchain

At its core, blockchain offers the potential to increase transparency and accountability, two essential elements to modern democracies. The exact ways in which technologies like blockchain may help increase transparency and accountability in government are varied and diverse, but numerous government operations share some common features that make employing a technology like blockchain a viable and serviceable option. As such, some government agencies are already investigating blockchain’s potential to increase efficiency and improve the democratic process in several ways.

Broadly, blockchain may improve the function and functionality of government agency operations. As a digital ledger that records transactions, blockchain can encode information from a particular source, at a specific time. Just like how a banking transaction will record a transaction amount and date, so too could blockchain be used to record precise information surrounding government business.

In particular, it would mean a digital record is accessible surrounding a variety of government operations, and accordingly reduce, if not remove, the risk of loss or damage that can otherwise occur with paper records, and other modes of data storage, thereby ensuring that the information is accessible in perpetuity. This could transform citizens’ personal interactions with their respective government agencies and even change citizen engagement on the whole.

The following provides an overview of various governments’ use of distributed ledger technology to support public administration at every level.

Global and local applications for blockchain technology in governance

Many government agencies have begun in-depth explorations of blockchain’s potential. The U.S Postal Service employs over 7.5 million people, and is central to the generation of $1.4 trillion annually. With such a large budget, employing technology to increase efficiency and reduce costs would have significant impact. The USPS has begun investigating how blockchain could improve on these services, with a particular focus on its potential to improve back-end services such as money orders, and international money transfers.

Blockchain research has also been seen in government agencies at the state level. Delaware is widely known as the go-to state for new company registrations due to its business-friendly state regulations. This may be great for the Diamond State’s economy, but all the paperwork involved in new company registration is undoubtedly a huge weight on taxpayer resources.

The state has been utilizing distributed ledger technology in various capacities, including employing smart contracts at the Delaware Public Archives to ensure record-keeping compliance (i.e., adhering to laws regarding the destruction and retention of record) as well as streamline UCC filings. The potential for blockchain to ultimately provide a quicker and more streamlined process has interested many in the state’s public and private sectors.

The innovation of blockchain also has implications for government agency work on an international scale. In tandem with other agencies, the U.S State Department has been an early advocate for the greater exploration of blockchain’s use in foreign affairs and diplomacy.

While it remains early in the process, three key areas are cited: promoting the democratic process‚ helping foreign nations improve their governance and political institutions‚ and a more effective administering of foreign aid. This last goal in particular could quickly deliver some real and clear benefits. The deployment of foreign aid retains a number of problems from transparency‚ to misallocation of funds‚ to theft.

Blockchain offers the potential to deliver aid one-to-one from the U.S government to an individual in need. In time‚ this could transform and improve aid dramatically. It’s already been used by the UN in Syriain this way‚ and could be expanded further still. Possible uses beyond these three goals are diverse, but at the very least its capacity to aid Americans overseas in need of consular support quicker, and more efficiently, shall be welcome news to any regular traveler.

Estonia is also leading the charge in blockchain innovation. With a population of only 1.3 million, the Eastern European country is actively pursuing the implementation of blockchain technology across a variety of government services. So far, one of its chief successes has been within the medical sphere, already making use of blockchain to digitise and secure the medical records of over a million citizens.

The UK has also made some inroads into the adoption of blockchain in government agencies. Right now London is testing the potential for a blockchain ledger with the hope it might improve security surrounding pension and welfare services‚ and stamp out fraud. Like the potential for blockchain in U.S. Foreign Aid, overtime the UK’s program could help ensure the right assistance gets to the right people more often.

It remains early in the process, but from Estonia to the UK to the United States, government agencies have been recognizing the potential value of blockchain and distributed ledger technology, and even implemented it in a number of areas.

Given the potentially revolutionizing impact on governments at every level, it is of course necessary to ensure that blockchain’s implementation and development adheres to privacy and security standards, and takes other relevant factors into consideration when unrolling it. As such, more investigation at this stage for blockchain’s specific use would be welcome news to many in the public and private sectors.